Oct. 21 (Bloomberg) -- Dividend payments by U.K. companies
will soar to a record 101.8 billion pounds ($165 billion) next
year, boosted by a special payout from Vodafone Group Plc, a
Capita Plc unit said.

That will be a 28 percent increase from the level in 2013,
when dividends are forecast to fall to 79.7 billion pounds, 1.1
percent lower than the previous high of 80.6 billion pounds in
2012, Capita Asset Services said.

“With the economy on the mend, profits should begin to
recover over the next 12 months,” Justin Cooper, chief
executive officer of shareholder solutions at Capita Asset
Services, said in the statement. “Special dividends are the
icing on the cake.”

The FTSE 100 Index has returned 16 percent, including
dividends, so far this year. Combined profit by companies in the
gauge are projected to jump 46 percent this year and 10 percent
next year, according to data compiled by Bloomberg. CEOs are
compensating shareholders amid signs the U.K. economy is
improving.

Payouts next year will be boosted by Vodafone’s 16.6
billion-pound special dividend following the carrier’s sale of
its stake in Verizon Wireless, Capita said. Vodafone, Europe’s
largest mobile-phone company, made $130 billion from the sale of
its 45 percent stake in its joint venture with Verizon
Communications Inc.

Dividends this year will slip because of a slowdown in
underlying-dividend growth in the third quarter, Capita said.
While payouts in the three months through September increased
5.7 percent from the same period last year, they fell by 60.5
million pounds from the second quarter.

Companies most dependent on economic growth raised their
dividends at almost the same rate as the so-called defensive
companies that are less influenced by economic changes -- 5.6
percent and 5.7 percent, respectively.

“The FTSE 100 has 166 billion pounds on its collective
balance sheet,” Cooper said. “This should all mean a pick-up
in dividend growth next year on an underlying basis.”